Discuss the below in detail:
Q: Transworld Deliveries is expanding its contract home delivery service into the Northeastern United States. The company anticipates that to accommodate this expansion it will need between 10 and 40 staffed delivery vehicles. Transworld is currently moving 10 of its own? vehicles, with? drivers, into the Northeast. The daily cost of operating its own fleet is $860 per? Vehicle, while the daily cost of leasing a vehicle and driver is expected to be $1,000 per vehicle. Using an expected value approach, should Transworld purchase additional vehicles and hire additional? drivers? If? so, how many would you? recommend?
Expected demad requirements:
| Requirements (in vehicles) |
10 |
20 |
30 |
40 |
| Probability |
.2 |
.3 |
.1 |
.4 |